How to move investments to another platform, or gift them to friends and family

The investment world has changed a lot over the past few years. Lots more people are choosing to put their money into investment Isas or individual stocks and shares, and with a proliferation of no-commission apps it is easier than ever.

And with experience, investors are becoming more sophisticated. You may have become well-versed in investment, and now think you could get a better deal by moving your pot elsewhere.

One of the best things to do is shop around and see what works best for the amount you can put away per month. 

Have a look at our top investment platforms guide, or check the fees table at the bottom of this article, to see if you could get a better deal elsewhere. 

We look at how you can transfer your stocks and share Isa and individual stocks to another platform, as well as gifting shares and what to do when you’re left shares as part of an inheritance.

Transferring between investment platforms

Those who began investing a long time ago and are paying hefty fees to investment managers may be tempted to move over to some of the no-commission apps. 

They may have realised that they are paying too much, or that what’s on offer isn’t wide enough for what they want to invest in.

But the last thing you want to do is transfer your investments only to find you’re going to be charged even more, so do check out the charges before making the switch. 

Most brokers make it relatively easy to transfer online, and use the Automated Customer Account Transfer Service (ACATS) to move investments securely.

You will need to put in a transfer request with your existing provider, fill out the transfer form with your new broker, and from there your broker will manage the transfer.

The old broker may charge a transfer fee although often online brokers offer to pay any fees but make sure you check any fees, charges or penalties before you move all of your investments over.

The process might differ slightly if you need to transfer from a broker based outside of the UK.

You should also check to see if you own any of the brokers’ proprietary investments, like their own mutual funds, that they won’t allow you to transfer to a new broker.

There are two ways to transfer your investments between brokers, either a stock transfer (in specie) or through cash.

A stock transfer does what it says on the tin: you transfer your assets meaning you can keep hold of your investments. This takes up to four weeks.

If you choose to sell your holdings and transfer the money as cash, it is more straightforward – but you might miss out on any returns or end up selling at a time that isn’t favourable.

You can also transfer your stocks and shares Isa, which crucially doesn’t count as new contributions for the current tax year.

As with transferring individual stocks, you can carry over the investments or you can sell the investments held in the Isa and pass on the proceeds to the new provider.

The Isa status of the cash will remain in place through this process, and the new provider will reinvest the money in line with your instructions.

If you want to keep part of your portfolio with your current broker, you can make a ‘partial transfer’, but this does mean you may have to pay commission and/or dealing account fees to two brokers.

Transferring shares as a gift

You might have considered putting money away for your kids, like our personal finance editor Lee Boyce has done for his daughter with a stocks and shares Isa.

However you might also consider gifting shares you already own instead, which is fairly straightforward.

Everyone has an annual gift allowance of up to £30,000, allowing you to give away your investments without it being added to the value of your estate for tax purposes.

You can transfer shares to family members or a spouse if you’re members of the same investment platform.

You could also consider something called ‘Bed and Spouse’ which involves selling the shares to someone in your household and immediately having them rebought in your partner’s Isa or Sipp. If you do this, you won’t be liable for any capital gains tax (CGT).

You will be liable to pay CGT if you’re gifting shares to someone who isn’t in your household – but you do have an annual allowance of £12,000 where you won’t have to pay tax.

Transferring shares after death

If you inherit a portfolio of shares and funds, there are various steps you need to take to make the most of your new assets. If you don’t, you may miss out on some of your inheritance.

If someone owned shares at the time of their death then the value of these shares will be included in their estate.

The executor of the will has to go through the probate process before transferring any assets, which will mean working out how much inheritance tax to pay.

All companies keep a share register of shareholders’ names and addresses and these are looked after by separate companies. 

The three main UK share registrars are Equiniti, Link and Computershare and they cover most UK companies.

Equiniti says you can notify it of the death before you have a Grant of Representation. This is the document that proves legal authority of the person entrusted to deal with the person’s estate.

Notifying the registrar of the death promptly stops any share sales and dividends from being issued.

If they are told of a shareholder’s death after the date that their dividend is confirmed, they cannot stop the payment from being made and a cheque or share certificate will be sent out.

If the shares are jointly held with someone else, the registrar just needs the death certificate – though they don’t accept copies – and a completed transfer of joint holding form.

That means the holding will be updated to only be in the name of one holder.

The next step is showing the registrar a Grant of Representation so that they can transfer or sell shares.

Equiniti offers a Small Estate service in cases where the value of shares at the date of death was less than £20,000, and it might be too expensive to get a Grant.

Whether or not Capital Gains Tax will be payable on the shares depends on whether they are sold during probate, and if so, whether they have increased in value since the date of death, according to Co-op Legal Services.

If shares are transferred directly to beneficiaries then no tax will be payable, but if the beneficiary then decides to sell the shares later on, they might become liable for CGT.